The upbeat trading action continues, and what we saw today was -- in many ways -- even better than last week. Volume was up, breadth was better and there was some leadership from key big-caps such as AAPL, AMZN, FFIV and CMG. There wasn't as much action in the speculative garbage names, but the rare earth sector remained hot.
There is no question this market is extended and that sentiment is a bit frothy, but, historically, the second trading day of a new year has an even better track record than the first day. However, after that, we start to lose the positive seasonality as we begin looking forward to fourth-quarter earnings season.
The close today wasn't particularly strong, and that could be an indication that pressure to protect recent gains is picking up, but the market still has not done anything wrong. The thing that seems to be bothering people the most about this market is that it simply refuses to correct. Even the perma-bulls are starting to worry that we are in for a pullback soon.